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    Rising oil boosts investors' optimism

    US markets surged on Tuesday as rising oil prices lifted energy shares. Energy issues gained 2.8%, marking fourth-straight advance. Investors' optimism was boosted also by developments in Greece’s debt negotiations and automaker’s reports of increases in January car sales. Markets discounted the negative economic news indicating the factory orders fell in December 3.4%, more than the 2.5% decline forecast. The ICE dollar index, a measure of the US currency unit against a basket of six major currencies, fell 0.9% with easing of worries about Greece’s debt. Today at 14:15 CET January Employment Change will be released in US by ADP Inc. The tentative outlook is neutral as private employment is expected to grow by 225000 after rising by 241000 in December. At 15:45 CET the Markit PMI Services final index will be released, with a forecast of a marginal upward revision to 54.1 from the preliminary reading of 54.0. And at 16:00 CET ISM Non-Manufacturing PMI for January will be released. The tentative outlook is neutral for the dollar.

    . Dow Jones Industrial Average

    European stocks closed near seven year high after the Greek government proposal indicated it backed down from earlier calls to write-down Greece’s bail-out debt. Greek government proposed to swap bail-out debt for growth-linked bonds instead, aimed at shifting the burden of repaying the debt further into the future by replacing some of the current debt with growth-linked bonds and perpetual bonds. Euro traded higher on signs that the negotiations will soon end in a mutually acceptable compromise. Today from 9:45 to 10:00 CET final January Services and Composite PMIs for euro-zone countries including Germany, France, Italy and Spain and Euro-zone itself will be released by Markit. The tentative outlook is positive with the euro-zone services sector forecast to expand over the previous month. At 10:30 CET January Services and Composite PMI will be published in UK. The tentative outlook is positive. And at 11:00 CET euro-zone Retail Sales for December will be released by Eurostat. The tentative outlook is positive.

    Nikkei is rising today extending its recovery from Tuesday's one week low. Financial shares are leading the gains as banks outperformed on strong earnings from Mitsubishi UFJ Financial Group. Yen traded lower against dollar staying in the familiar range of ¥117- ¥119.

    Oil surged on Tuesday on speculation that a sharp decline in US drilling activity will result in supply declines. BP Plc announced it may spend less than previously planned after prices slumped more than 50 percent since June. While oil companies are adjusting their capital expenditure plans in the face of falling oil prices, market observers note that it will take time to balance the projected global surplus of roughly 1.5 million barrels a day. Currently global inventories are building as more unused oil goes into storage in many countries. Today at 16:30 CET Crude Oil Inventories change for the week ended January 30 will be released by the US Energy Information Administration. A report from the industry group American Petroleum Institute yesterday showed US crude stocks rose more than 6 million barrels last week.

    oil prices

    Gold slipped on Tuesday as safe-haven appeal faded with Greece taking a much more accommodating stance on its standoff with the European Union on repayment of debt.

    Commodities rose as surging oil prices boosted investors' optimism. Sugar led increases in agricultural commodities, with New York futures gaining as much as 3.7 percent.

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